DAN GLEITER, The Patriot-News/2006
Cinema Center employee Pete Marren of Camp Hill serves popcorn, pretzels and drinks at Cinema Center on Simpson Ferry Road in Lower Allen Township, Cumberland County, Pa.A bill in the Pennsylvania Senate that would increase taxes for movie theaters has spurred theater managers to begin a postcard drive against it.
The bill, Senate Bill 652 introduced by state Sen. Jeffrey E. Piccola, R-Dauphin County, would add the 6 percent sales tax on fees theaters pay to rent movies from film producers and distributors in order to show them. Piccola's chief of staff, Christopher Ramsey, said the bill is Piccola's alternative to Gov. Ed Rendell's higher education tuition assistance plan. Rendell wants the tuition assistance to be funded by legalizing video poker in bars and restaurants.

Part of the $145 million Piccola plan would come from this tax; part would come from repealing the $75 million film tax credit given to filmmakers who make a movie in Pennsylvania, Ramsey said. Ramsey says Piccola doesn't think taxpayers should be "subsidizing industries that do fine on their own in the marketplace" and that the largest factors affecting movie ticket prices are "industry-driven."

In response, large and independent theaters alike began a statewide campaign this weekend urging theatergoers to sign postcards opposing the bill. The postcards will be sent to state senators. Theater owners argue that the bill could raise movie ticket prices and force independent theaters in smaller communities to close because they couldn't afford to rent the films.

Rental fees vary for every movie, and that fee is negotiated with the film companies. As an example, Paramount, which produced "Star Trek," would receive about 60 percent of the $72.5 million the film made in its opening weekend nationwide back in rental fees. What film companies make in rental fees is not made public, and theaters are not permitted to divulge the rental fees they are charged, said Cinema Center CEO Gina DiSanto.

DiSanto said her chain has received more than 2,500 postcards. DiSanto is a board member of the National Association of Theatre Owners of Pennsylvania. "Even though we applaud that the money would go toward the educational scholarship fund, if this film rental tax would go through, it could possibly force some theaters to close, thereby hurting communities because they don't have a local theater," she said.

Mark Huff, district manager for Great Escape Theaters, which has a 14-screen theater in the Harrisburg Mall, Dauphin County, calls the proposal "a double taxation." He said the chain has received 1,000 postcards from consumers at its three Pennsylvania locations.

"The more we have to pay to get the films in, the more we have to charge. We've got a minimum per-capita to meet for each film company, and the only way to meet those is via the ticket prices," Huff said. "So if the film rental charges go up, somehow we have to pass that along to the consumer."

At the one-screen Elks Theatre in Middletown, operator Ross Seltzer ran out of his postcard supply last weekend; he said 20 to 30 signed cards have been handed in. He plans to post a copy of the bill in the theater.

"It would be thousands of dollars for us that I'd have to make up somewhere else by raising prices," Seltzer said of the tax. "We're a small business that operates on a shoestring budget. It could possibly put us under. It could be the tipping point."

COMMENTS (17)Post a comment
Posted by bushaw2006 on 05/13/09 at 12:36AM
please do not pass the bill. dont wanna see popcorn go up even more. lol

Inappropriate? Alert us. Post a commentPosted by Jollibee on 05/13/09 at 6:18AM
This just means that when the theatres raise the prices for things in the near future, they have something to blame it on for once. Those theatres make plenty of money. Hell they only have about five or six employees running most of the place and I am sure they are not high paid people. With big movies the theatres are pretty full too so the money is flowing.

Inappropriate? Alert us. Post a commentPosted by P0O0P on 05/13/09 at 6:19AM
Hey, I wait for the movies to make their way to the big red box for $1 a day for two reasons. I am somewhat cheap and seeing a movies in a theater is not cheap.

Inappropriate? Alert us. Post a commentPosted by againstgrain on 05/13/09 at 6:55AM
As if they aren't expensive enough as it is now. A new release to me is when it comes out on cable TV.

Inappropriate? Alert us. Post a commentPosted by dazzed on 05/13/09 at 8:26AM
That's it, raise the price on such an enjoyable thing as sitting in a theater with loud, rude obnoxious people, talking on their cell phones, and acting like it's their own private veiwing. No thanks, I wait for it to come out on video or watch it when the networks run it.

Inappropriate? Alert us. Post a commentPosted by bakabaka on 05/13/09 at 8:26AM
Oh no no no no.... the theater is buying a product at "cost" to sell to the public at their chosen "retail." If we start taxing goods at the point they are procured by one retail establishment more will follow and soon we'll be buying weedwackers that have been taxed at the point Joe Schmo Hardware purchased them and AGAIN when Joe the Lawn Guy buys one for his yard.

It's doubly bad for the customer because Joe Schmo Hardware will have to raise their prices to cover that tax and then 'we the people' will pay a higher sales tax on the higher priced product.

This is a great money raising scheme but it completely screws 'we the people.' It'll start at the theater and quickly spread.

Inappropriate? Alert us. Post a commentPosted by jeraholic on 05/13/09 at 8:45AM
Typical Government. When something starts doing better then everything else they choose to tax it. Rendell is a complete idiot and he is hurting us everwhere. He sees an opportunity to line his pockets with more money and does so, but he never does any good with it. So here we go, we tax an industry that is booming right now. All of the other industies are having bailouts, and the theaters are doing well. So they get the tax?

Inappropriate? Alert us. Post a commentPosted by couponlova on 05/13/09 at 8:46AM
To you haughty idiots who think you know everything about everything, and obviously don't have a clue about the theater business, I'll fill you in.

Theaters don't make a dime off of the ticket price. They charge what it takes to pay for the movie, typically its the big shots in Hollywood who are pocketing all of your cash.

Theaters make their money on concessions. Take this theater for instance, a very large building with high quality seating, sound, and facilities - they have to pay for the building, the help, and all other general expenses from the concession sales. The operating costs are high, and the net profit on the concession sales must be equally as high.

So why don't you learn something before you open your mouth? No one would know you were stupid if you just kept your mouth shut.

Inappropriate? Alert us. Post a commentPosted by jeraholic on 05/13/09 at 8:47AM
Typical Government. When something starts doing better then everything else they choose to tax it. Rendell is a complete idiot and he is hurting us everwhere. He sees an opportunity to line his pockets with more money and does so, but he never does any good with it. So here we go, we tax an industry that is booming right now. All of the other industies are having bailouts, and the theaters are doing well. So they get the tax?

Inappropriate? Alert us. Post a commentPosted by jeraholic on 05/13/09 at 8:47AM
Typical Government. When something starts doing better then everything else they choose to tax it. Rendell is a complete idiot and he is hurting us everwhere. He sees an opportunity to line his pockets with more money and does so, but he never does any good with it. So here we go, we tax an industry that is booming right now. All of the other industies are having bailouts, and the theaters are doing well. So they get the tax?

Inappropriate? Alert us. Post a commentPosted by smkr on 05/13/09 at 8:55AM
Posted by couponlova "No one would know you were stupid if you just kept your mouth shut."

Whereas in your case, you opened your mouth, had to resort to name calling and PROVED how stupid you are.

Inappropriate? Alert us. Post a commentPosted by smkr on 05/13/09 at 8:56AM
Posted by couponlova "No one would know you were stupid if you just kept your mouth shut."

Whereas in your case, you opened your mouth, had to resort to name calling and PROVED how stupid you are.

Inappropriate? Alert us. Post a commentPosted by smkr on 05/13/09 at 8:57AM
Posted by couponlova "No one would know you were stupid if you just kept your mouth shut."

Whereas in your case, you opened your mouth, had to resort to name calling and PROVED how stupid you are.

Inappropriate? Alert us. Post a commentPosted by smkr on 05/13/09 at 8:57AM
Posted by couponlova "No one would know you were stupid if you just kept your mouth shut."

Whereas in your case, you opened your mouth, had to resort to name calling and PROVED how stupid you are.

Inappropriate? Alert us. Post a commentPosted by smkr on 05/13/09 at 8:58AM
sorry about the dups.

Time to watch your favorite poster school the Neo-con nub known as couponlova.

Hey sweetcheeks. Since the rental fee is different for every movie, but ticket prices are set theaters do make money on the sale of tickets. Albeit not much; your assertion that that 'don't make a dime' is incorrect. On average it's about 5%.

Now that I'm done schooling you, it's on to bigger fish.

Folks, do you really need any more proof that the DEMS and GOP are just part of the same great big machine? Here is a prominent GOP member doing what Spendell does...tax and spend, tax and spend.

Vote third party.

Have a blessed day.

Inappropriate? Alert us. Post a commentPosted by FedUp78 on 05/13/09 at 11:28AM
There is no law or agreement which prevents a theatre from disclosing what it pays in rental to a distributor. Most theatres just refuse to disclose that information for fear of giving a competitor an advantage.

The typical 8 to 14 screen first run multiplex theatre pays an average of somewhere between 50 to 55% of their total gross for film rental per week when averaged over the entire complex.

Now let's do some math here. A typical multiplex theatre averages about $150,000 per screen in admission dollars per year. 150,000 x 12 screens = $1,800,000 for a complex. $1,800,000 x 52.5% film rent (median of 50 to 55%) = $945,000 film rent for the year. $945,000 x 6% = $56,700 per year. In other words it would add about $1,000 per week to a typical theatres overhead.

Divided by the typical 225,000 tickets sold by a theatre in a given year the 56,700 would add .25 cents to the cost of a typical ticket.